Sony to Shift Away from Gadgets

Megalith

Megalith

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With the hardware business being “peanuts,” Sony is transitioning to other methods of profit that include online content, recurring subscription services, and intellectual property licensing. CEO Kenichiro Yoshida will be unveiling a three-year plan on how these categories will drive and sustain the company’s growth.

It’s a tectonic shift for a company built on manufacturing prowess. Sony popularized transistor radios, gave the world portable music with the Walkman and its TVs were considered top-of-the-line for decades. With the rise of Chinese manufacturing, making and selling gadgets has become a business with razor-thin profit margins.
 
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So Sony is basically going to become a lesser version of IBM... and due to one small paradigm shift, will quickly become totally irrelevant in an already overly saturated market and will depend solely on lawyers like Oracle.
Can't see how this could go wrong!
 
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Hmmm: "Online Content; Recurring Subscriptions; & Licensing Fees". These things are called VAPORWARE by an old software programmer.
 
In other words, they are having a hard time sustaining movie and music profitability, they are getting undercut and outperformed in the electronics sector, so pretty much the only thing that is consistently bringing in money is their gaming unit, and they are going to develop ways to milk that for all it is worth.
 
Can't remember the last time I bought a Sony product.. Wait. I do.. They both broke within months...

But I sure did love my walkman in the 80s.
 
Doesn't Sony still make a lot of the camera sensors used by other high end brands? Wonder if that'll be hit?

Surely that end of the market is still profitable, at the prices they ask...
 
The logic in this article is bogus. "...the rise of Chinese manufacturing has turned gadgets into a business with razor-thin profit margins." Oh really? Where does Sony manufacture their goods again? Globally. The Rx series cameras are manufactured in China. Their A7 series cameras are in Thailand. Their lenses are a mix of China, Japan and Thailand. Chinese manufacturing is nothing new. Companies have been exploiting cheap chinese labor for decades. Sony's had factories their for decades. The only thing that has changed recently is the rise of chinese-owned companies producing electronics in china and competing in the global marketplace. The rise of companies like DJI, Huawai, Xiaomi are what is hurting Sony's profits. Chinese lens development has also improved, to the point where chinese-owned companies like LAOWA and Meike are producing lenses of similar or better quality than sony's for less money. Now they no longer have the advantage of using cheap assembly and production labor. They can't compete on hiring cheap engineering labor too.
 
Red Falcon said:
So Sony is basically going to become a lesser version of IBM... and due to one small paradigm shift, will quickly become totally irrelevant in an already overly saturated market and will depend solely on lawyers like Oracle.
Can't see how this could go wrong!
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Big box stores are going the way of the dodo bird.
Keep producing stuff that people aren't walking into the stores to buy and you'll incur huge losses.

Digital and Subs are the future. The new generation want things to be as cheap as possible and trade in as soon as possible.
You can even sub a new car from Volvo for a year: https://www.volvocars.com/us/cars/new-models/xc40/care-by-volvo
 
They arn't selling walkman's or boombox's or ebook readers and can't get higher prices for their earphones and they are being dominated in other traditional Sony markets. Aka they are not the leading innovator they once were. This could very easily be the future of Apple.
 
Oh no, please don't go, please don't, nooooo. /said in a dry manner.


Nallexi said:
Doesn't Sony still make a lot of the camera sensors used by other high end brands? Wonder if that'll be hit?

Surely that end of the market is still profitable, at the prices they ask...
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Most action cams and phone cameras are based on Sony IMX sensors, even some other brand DSLR/Mirrorless use a Sony sensor. I assume that will stay as is, since it's not a consumer gadget where you have to also pay for packaging / marketing / consumer support and so fourth. I think that division is actually profitable.
 
Sony just can't build anything worth buying. Just look at XZ1 "compact" 5.0" screen, just because marketing team says that people love big screen, when there is no options good smaller phones, and didn't even tried to behind some BS story for removing headphone jack like other manufacturers and straight said, that they removed because other manufacturers also removed from their devices.
 
I remember in the 80's and 90's - Circuit City, Sight & Sound (think it was midwest only), and a few other higher-end stores that specialized in audio/video equipment. Sony used to be a decent brand. Not high end, but affordable and known for quality.
Scratching my head on the last Sony device I have purchased - thinking it might have been an S-VHS device. Want to say I paid about $600 for it? I also had a 10 disc CD changer I put in my old Honda Civic.
 
commissioneranthony said:
The logic in this article is bogus. "...the rise of Chinese manufacturing has turned gadgets into a business with razor-thin profit margins." Oh really? Where does Sony manufacture their goods again? Globally. The Rx series cameras are manufactured in China. Their A7 series cameras are in Thailand. Their lenses are a mix of China, Japan and Thailand. Chinese manufacturing is nothing new. Companies have been exploiting cheap chinese labor for decades. Sony's had factories their for decades. The only thing that has changed recently is the rise of chinese-owned companies producing electronics in china and competing in the global marketplace. The rise of companies like DJI, Huawai, Xiaomi are what is hurting Sony's profits. Chinese lens development has also improved, to the point where chinese-owned companies like LAOWA and Meike are producing lenses of similar or better quality than sony's for less money. Now they no longer have the advantage of using cheap assembly and production labor. They can't compete on hiring cheap engineering labor too.
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Just like all the exploiters they are now eating shit as the chinese have either stolen or just been given the technology to build their own things at a higher standard for even cheaper again. I saw it coming and am still laughing at these arseholes who moved all their operations to china only to be beaten by them. They can all keep eating the shit ball they sent rolling. I really like my xiaomi phone. :) Also note It was around that time that sony products became garbage anyway.
 
Sony's insurance arm is where they make all of their money. They have their fingers in a lot more places than people tend to realize.

I think it's sad that they joined the race to the bottom in the "gadget" space through the 90s, before that they were generally a premium product like apple is considered today but they sold themselves out to the Walmart shelves of the world.

It's a smart move to finally give up and let the no-name amazon brands from china have the Bluetooth speaker market and all those other random things clogging their catalog that they can't sell. I don't see them giving up on cameras and hopefully TVs yet since they still have respect in those areas, but who knows they are probably looking way further ahead and might cut those now to ensure a profitable future.
 
Most of their gadgets are made by nasty cheap Chinese OEMs anyway.

But it’s so bloody sad to see what Sony are turning into. They were a giant and the brand most geeks looked up to once upon a time.

They don’t even make their own TV’s anymore! So sad.
 
GandraZz said:
Sony just can't build anything worth buying. Just look at XZ1 "compact" 5.0" screen, just because marketing team says that people love big screen, when there is no options good smaller phones, and didn't even tried to behind some BS story for removing headphone jack like other manufacturers and straight said, that they removed because other manufacturers also removed from their devices.
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The Sony Alpha series of full-frame cameras are IMO the best in the industry. Their sensors and AF systems are in a league of their own. Seriously, you cant even get a Sony A7 III right now if you wanted to, its been back-ordered since it came out in early April.

Sony's problem is that it is getting too much of its revenue from low margin products and when it comes to new product segments, it arrives to the party too late to matter.
 
huh i remember when sony made computer monitors, the best monitors in the world. and they stopped selling because "it wasnt making a profit".
 
AndreRio said:
huh i remember when sony made computer monitors, the best monitors in the world. and they stopped selling because "it wasnt making a profit".
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Yeah Sony crt trinitron monitors were the best , then LCD happened and they wasted their market position
 
Sony camera business in still alive. I love my A6300. Not sure about the other things.
 
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